Zainab Ahmed: Why initial concession deal for e-customs project was cancelled

Zainab Ahmed, minister of finance, budget, and national planning, has explained why the $3.1 billion contract for automation of the operations of the Nigeria Customs Service (NCS) was rescinded.

The contract was approved by the federal executive council (FEC) in 2020.

Speaking with state house correspondents on Wednesday, the minister said disagreements between partners that formed a consortium for the project delayed its takeoff.

On Monday, the NCS signed a concession agreement worth $3.2 billion to digitise its operations.

Asked to explain the rationale behind a new e-customs concession agreement, Ahmed said the previous contract was stalled despite the intervention of the government through the office of the attorney general of the federation.

“The e-customs project was approved by the council. And there were some challenges that had to do with disagreements between the concession partners,” the finance minister said.

“Remember that the government was not a partner of the concession, it was a group of different investing parties that came together and formed the consortium.

“The attorney-general and minister of justice has intervened. There were several number of meetings to try to iron out the differences. So it has to do with shareholders, who has what responsibility. And at the end of the day, I think one of the partners in the concession did not agree with the arrangements.

“So the partner that signed was already in the initial concession. So that one party did not agree with the terms that are signed. And there is a new agreement that had been signed and that partner was reported to have opted out of the concession.

“I haven’t seen the report yet but it was reported to have opted out of being in the concession. So there is a new concession agreement that has been committed.”

Earlier, Hameed Ali, NCS comptroller-general, had explained that the NCS will generate $176 billion over the next 20 years through the implementation of the e-customs project.

Ali said the e-customs concession project would ease the cost of doing business, boost revenue, enhance productivity and stop every arbitrariness in the service.

“The $3.2 billion e-customs project to be financed by the Africa Finance Corporation (AFC) and managed by Huawei Technologies Limited under a 20-year concession window, when fully implemented, would quadruple customs’ current N210 billion monthly revenue collection,” Ali had said.